Compare COBRA and Marketplace Plans
Lost your job-based health insurance? Understand the key differences between COBRA continuation coverage and ACA Marketplace plans to make the best choice for your situation.
What is COBRA?
COBRA (Consolidated Omnibus Budget Reconciliation Act) allows you to temporarily continue your employer-sponsored health insurance coverage after losing your job, reducing work hours, or experiencing certain life events.
Key Facts About COBRA:
- • Continuation of your existing employer plan (same coverage, doctors, and networks)
- • Typically lasts 18 months (sometimes up to 36 months)
- • You pay the full premium (employer contribution + employee share + 2% admin fee)
- • Available to employees at companies with 20+ employees
- • Must enroll within 60 days of losing coverage
What are ACA Marketplace Plans?
ACA Marketplace plans are comprehensive health insurance policies available through the Health Insurance Marketplace, offering coverage with potential subsidies based on your income.
Key Facts About Marketplace Plans:
- • Choose from multiple plans with varying coverage levels (Bronze, Silver, Gold, Platinum)
- • May qualify for premium tax credits (subsidies) based on income
- • May qualify for cost-sharing reductions with Silver plans
- • Coverage continues year-round (no 18-month limit)
- • Losing job-based coverage qualifies you for Special Enrollment Period
- • All plans cover essential health benefits
Side-by-Side Comparison
Cost
COBRA:
Full premium (100% + 2% admin fee). Often $500-$1,500/month or more.
Marketplace:
Varies by plan. May qualify for subsidies that significantly lower costs.
Duration
COBRA:
Temporary: 18-36 months depending on circumstances.
Marketplace:
Ongoing coverage. Renews annually during Open Enrollment.
Coverage
COBRA:
Exact same plan you had with employer. Same doctors, networks, benefits.
Marketplace:
Choose from multiple plan options. Different networks may apply.
Important Considerations
- •Compare costs carefully: COBRA premiums are often higher than subsidized Marketplace plans, especially if you qualify for tax credits.
- •Check your doctors: If keeping your current doctors is critical, verify they're in-network for Marketplace plans you're considering.
- •Time limits: You have 60 days from losing coverage to elect COBRA or enroll in a Marketplace plan through Special Enrollment.
- •Consider your situation: If you expect to return to work soon, COBRA might make sense. For longer-term coverage, Marketplace plans are often more affordable.
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Compare Marketplace plans and see if you qualify for subsidies that make coverage more affordable than COBRA.
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